Tuesday, October 27, 2015

Osborne should start dealing with the obscene level of money laundering crime and stop obsessing over working tax credits!

I had a great interview yesterday on the Max Keiser
programme, during which we discussed the dichotomy that is George Osborne! Max
teased me for my recent blog in which I accused George of unwittingly facilitating
financial crime in the City! Of this, more later!

George Osborne has now been defeated in the House of
Lords over his deceitful attempts to deny working tax credits to ordinary men
and women who are working for a living, but at a low standard of income.

I say his plans are deceitful because a) they were not part
of the Tory Election Manifesto in the first place, Osborne refused to say where
he would make cuts in public expenditure, and Cameron had said publicly that he
would not cut tax credits (although it is now not clear whether he meant child
tax credits or working tax credits)! Secondly, the Tories tried to cheat by
putting the deal through in the form of a Statutory Instrument (which the
second chamber can vote against) as opposed to a finance bill, which by tradition,
the second chamber would not vote down.

Perhaps what is more important is the fact that this
blatant attempt to hoodwink the House of Lords, backfired on the Tory toffs,
and they have been made to pay for it. It is all typical of the way in which
they think to run politics in the UK, it’s all part of a silly public schoolboys’
game, in which the clever side which can dissemble better, wins the prizes. It
is all predicated along the lines of the debates in the Oxford Union, during
which witty and clever tricks are pulled on the opposition. Under other
circumstances, it would all be so terribly funny, except that it has terrible
implications for the lives of hundreds of thousands of working people who rely
on working tax credits to keep their heads above water.

Of course, the Tories are whingeing and bleating,
accusing the House of Lords of unconstitutional actions and threatening all
kinds of dire retribution, including the possibility of flooding the second
chamber with up to 150 new peers to give the Tories a majority there.

It isn’t going to happen of course. Just the thought of
the toffs party creating 150 new peers to railroad through unpopular Tory policies
designed to grind the faces of the poor, is so risible, that even this present
bunch of spivs, second-rate accountants and Little Englanders will think twice
before doing such a stupid action.

But the point to remember is that this piece of political
chicanery was designed to take away £4.4 billion in working tax credits from
people who need it most, people who are working and who may have young children
and who, without the benefit of this payment, will find it incredibly hard to
manage.

Working tax credits are in fact a subsidy on employers
who have been encouraged to pay very low wages. The money which the tax payer
is paying out is subsidising the employers who are paying wages, some of which
are below the statutory minimum.

I don’t have anything against a man or woman who starts
up a business, with the aim of creating a product, or providing a service, and
who, in so doing, provides work for ordinary people. As long as the employer
pays a fair wage on which his workers can live with dignity, and pays the
correct level of taxes he is required so to do, then I don’t care if the
employer becomes very rich indeed.

But if he is paying wages which are so low that the
employee needs to seek a state handout in order to survive, then I want to know
why I am subsidising that employer’s profits. I don’t want to live in a welfare-benefit
society, I want to live in a society where men and women are paid fairly and
sufficiently so they don’t need recourse to welfare, but it is not realistic to
take tax credits from people now in return for the promise to the future of
better pay in 5 years time! That doesn’t cut any mustard at all!

These points were all raised and aired yesterday in my
talk with Max Keiser.

The biggest point I wanted to make was that in their
attempts to curb the benefit culture, the Tories are attacking the one group of
society, who can afford it least, while at the same time, they are rewarding a
small group in society, the bankers and the financiers with a very great deal
of money, men and women who are busily getting very rich indeed on the proceeds
of the foreign criminal money which is flooding into London.

So, on the one hand, Osborne is seeking to take away
money from people who have been depending on its legitimate receipt in order to
make ends meet, while at the same time, turning a blind eye to the wholesale
breaking of the criminal law, in the way in which the crooked bankers handle
and facilitate vast amounts of foreign money which is finding its way into
London.

So there is one rule for the absurdly rich, dishonest and
powerful in society, and another for the poor and marginalised.

Now, at this point, I expect to start receiving messages
from the unreconstructed spivs who sometimes read my blogs to see how much they
can disagree with me.

‘If we don’t
accept this money, it will merely go elsewhere’ is quite a common observation.

‘It has always been like this, why are you making such a
fuss’ is another.

My point is that we have laws in this country which have
been introduced to prevent the proceeds of crime from being easily assimilated
into the financial system.

Those laws and regulations require banks to undertake significant
checks and due diligence procedures to ensure that they know the provenance of
the funds, and so they can demonstrate a good knowledge of their customer, his
or her business practices, and sources of finance and wealth, in order to be
able to satisfy themselves and the regulators, that the funds they are handling
do not come from illicit or illegal; sources.

Put it like this, if a man were to walk into a bank with
a bag marked ‘swag’, we might think it odd if the bank teller did not make some
enquiries as to the provenance of the money being offered to his institution,
before accepting it!

The fact that the money is paid into the bank from an
account held in some offshore jurisdiction, or from a solicitor’s client trust
account, does not release the banker from his obligations to make the necessary
enquiries to establish the lawful provenance of the money.

That illicit money may only be passing through the financial
system via the bank account in London, but you may rest assured that the bank
will be taking a fee for such a facilitation, and the larger or smellier the sum
of money being transmitted, the bigger will be the fee.

But George is making it easier and easier for his friends
in the banking sector to accept this money, and that is why I accuse him of
unwitting complicity in the facilitation of international organised crime.

You do not help to prevent crime by de-regulating the
financial sector within which much of the criminal facilitation is taking
place. If you are serious about trying to prevent crime, you first make sure
that the regulations are being applied and properly performed, and we know from
repeated reports from the FCA and the NCA that this is not happening, yet
George just goes blithely on ignoring them!

You should make sure that the banks are taking the necessary
steps to identify potential Politically Exposed Persons, before their money is
paid into your bank. In a story in The Times, yesterday, it was reported.

“...General
Franco amassed a fortune by siphoning hundreds of millions from the Spanish
state, according to a new book.

The
dictator, who died in 1975 after ruling Spain for 36 years, took money given to
the state, and from state enterprises, at a time when millions were starving in
the aftermath of the civil war from 1936 to 1939...”

None
of this money has been recovered and Franco’s descendants are still living off
the benefits of its criminal origins.

When
I was a serving detective, we used to say that if there were no people willing
to handle the dishonest proceeds of thieves and robbers, it would make life
significantly harder for the thief to benefit from his crimes. That is why the
Courts have traditionally punished handlers more severely.

The
same goes for the banks in their handling of stolen money, if they were less
willing to accept the money offered to them in dubious circumstances, criminals
would find it much harder to profit from their crimes. Yet strangely, nothing
is happening to bring the bankers to book.

Iceland
has so far sentenced 26 bankers and financiers to prison terms for crimes related
to the global financial crisis. Their combined jail time is 74 years. A great
many more prosecutions are expected. In Britain, no banker has yet been tried
or jailed for such crimes. It makes you wonder whether bankers might be some
sort of "protected species"

We
should not be expected to continue to put up with this egregious level of
criminality and wrong-doing from within our banking system, and bankers should
not be able to get away with the winks and the nods they are being given from
the Treasury as to which money they can accept.

Again,
a staggering level of British hypocrisy is involved.

If
the Government wants the banks to be able to accept this loose money with
impunity, then the least they should do is to repeal the laws which aim to deal
with the criminal laundering of dirty money.

Take
these laws off the statute books and advise the banks that it is now open season
for them to accept any money they want to. Of course, this would not go down
well in our relations with Europe or the USA for that matter, and so rather
than face the degree of political opprobrium which would necessarily follow
such a decision, the Government turns a convenient blind eye and lets the banks
carry on with’ business as usual.’

9 comments:

I am a 70 year old woman in Scotland still in favour of Independence. I despair on a daily basis at what is happening to all of the U.K. but particularly Scotland. The U.K. Gov seem to be untouchable and having seen you on RT just now that seems to be the case. I have no doubt that we will be independent one day but we will be on our knees. Is there any hope?

'Twas ever thus & thanks for letting the cat out of the bag. The awful thing is, most people I talk with aren't really bothered & don't want their comfy worlds in this plutocracy upset. Depressing! Oh, I disagree with you & say say Osborne knows exactly what he's doing & is complicit in the facilitation of banking crime. He's doing the tax credit thing thing maliciously, & he is doing it because he's part of a government deeply into social cleansing.

Sir, methinks you are being far too charitable to Mr Osbourne! I do understand though that for legal or other professional reasons you might be exercising some restraint. Is it really conceivable that Mr Osbourne has no idea that he plays a crucial role in ensuring that effective regulation and control of the bankers is frustrated and stultified?

Your analysis though is brilliant and really is bang on the money but please let's not kid ourselves that this scenario only arises because our poor saintly Chancellor is unwittingly being manipulated by this incredibly greedy set of City scammers! In my opinion they are all part of one giant mechanism of deceit and can only operate on the basis of mutual co-operation!

Thanks for the light you are shining on Osborne's and the MSM priority to defuse and obfuscate the issues. Over 100 billion is bypassing the exchequer and our young apprentice is sitting on his hands. May I suggest an excellent book to you. Its called 'zero zero zero'by Roberto Saviano and deals with the drug/money laundering capital of the world, the City of London.best of luck with future endeavours, take careIngo

About Me

Having spent my career dealing with financial crime, both as a Met detective and as a legal consultant, I now spend my time working with financial institutions advising them on the best way to provide compliance with the plethora of conflicting regulations and laws designed to prevent and forestall money laundering - whatever that might be! This blog aims to provide a venue for discussion on these and aligned issues, because most of these subjects are so surrounded by disinformation and downright intellectual dishonesty, an alternative mouthpiece is predicated. Please share your views with what is published here from time to time!